Dáil Éireann debate -
Thursday, 31 May 2001

Vol. 537 No. 4

Written Answers. - Tourist Accommodation.

Ivan Yates

Question:

21 Mr. Yates asked the Minister for Tourism, Sport and Recreation the reason he does not anticipate that a portion of the £350 million, available for tourism development over a seven year period, will be allocated for the development of tourist accommodation, particularly in the small family owned hotel sector; and if he will make a statement on the matter. [16068/01]

Enda Kenny

Question:

30 Mr. Kenny asked the Minister for Tourism, Sport and Recreation the grant aid available for the development of tourism accommodation. [16103/01]

Minister for Tourism, Sport and Recreation (Dr. McDaid)

I propose to take Questions Nos. 21 and 30 together.

Bord Fáilte was the implementing body for tourism product development under the Tourism Operational Programme 1994-99, with decisions on grant approval being made by an independent product management board. A similar arrangement will be in place for the period of the current national development plan under which I was able to obtain a commitment of £100 million, to be co-funded by the European Regional Development Fund, for tourism product development. The remaining £250 million that I secured for tourism under the NDP is for marketing and human resource management.

The new tourism product investment scheme will be administered via the tourism measures of the regional operational programmes. The overall objective of the scheme is to develop the tourism product in a sustainable way that widens the spatial spread of tourism, diverts pressure from highly developed areas and increases the under performing regions' share of overseas tourism revenue.

There is a general consensus that the focus of public investment in tourism projects must be to enhance the potential of less developed tourism areas by supporting the development of significant attractions or clusters of attractions in such areas.

Hotels continue to benefit from the capital allowance scheme under which capital expenditure on any building or structure in use as a hotel or holiday camp, registered with Bord Fáilte, may qualify for capital allowances. Beneficiaries are entitled to claim a maximum 15% capital allowance in years one to six and 10% in the final year. As recently as February last, the Irish Hotels Federation, in its document Blueprint for the Future – A strategic Review and Recommendations for the Irish Hotel and Guesthouse Industry, affirmed that capital allowances remain the most important form of incentive available to hotels.

I appreciate the contribution that small accommodation providers, including small hotels, have made to tourism and I recognise the need to encourage and develop the sector. An initiative, targeted primarily at the small accommodation provider, has been launched whereby Bord Fáilte carried out a fundamental review of how the various groups in this category were branded and marketed overseas – with a view to increasing business overall and particularly in off season and in rural areas. Almost £1.4 million has been set aside for this initiative to date and it has considerably expanded the range of support offered to the sector, thereby developing the marketing capabilities of the operators themselves.

Detailed guidelines for project promoters on the new tourism product investment scheme have been drafted by Bord Fáilte in consultation with my Department. Meanwhile the scheme is still being examined under the State aids rules by DG Competition of the European Commission, to whom the scheme has been formally notified as required by the relevant legislation.

Question No. 22 answered with Question No. 7.